BIR Ruling [DA-194-05]

April 21, 2005 BIR RULING [DA-194-05] Section 270; BIR Ruling No. DA-020-03 Ms. Gregoria R. Trajano 13 El Salvador St. Better Living Subdivision Paraaque City M a d a m : This refers to your letter dated February 16, 2005 requesting for a certified photocopy of the income tax return of Zenaida C. Bucu filed for the year 1998. It is represented that the certified photocopy of the income tax return of Zenaida C. Bucu filed for the year 1998 is a requirement for the processing of her Pag-ibig Housing/Home Development Mutual Fund loan; and that the Special Power of Attorney dated September 27, 1990 executed by Zenaida C. Bucu appoints you to specifically perform the following acts, viz : "TO CLAIM the release of the original Transfer Certificate of Title No. 167332 mortgage at the Planters Development Bank through the Pag-ibig Housing Loan upon full payment of loan balance account with the Bank; TO MAKE payments of the monthly amortization of the loan for the above mortgaged property; TO APPLY for condonation of the penalty on the loan with Pag-ibig or Home Development Mutual Fund; TO RECEIVE checks for refund of prepaid insurances, TO NEGOTIATE any other transactions that may be required in connection with the Pag-ibig Housing Loan." In reply, please be informed that Section 270 of the Tax Code of 1997 provides, "SEC. 270. Unlawful Divulgence of Trade Secrets . Except as provided in Section 71 of this Code and Section 26 of Republic Act Numbered 6388, any officer or employee of the Bureau of Internal Revenue who divulges to any person or makes known in any other manner than may be provided by law information regarding the business, income or estate of any taxpayer, the secrets, operation, style or work, or apparatus of any manufacturer or producer, or confidential information regarding the business of any taxpayer, knowledge of which was acquired by him in the discharge of his official duties, shall upon conviction for each act or omission, be punished by a fine of not less than Fifty thousand pesos (P50,000) but not more than One hundred thousand pesos (P100,000), or suffer imprisonment of not less than two (two) years but not more than five (5) years, or both." In Opinion No. 72, Series of 1991, the Secretary of Justice opine that individual income tax returns under the first paragraph of the aforequoted Section "shall constitute public records and be open to inspection as such upon the order of the President of the Philippines under rules and regulations to be prescribed . . . by the Secretary of Finance." The existing rules on inspection of such returns provide that such inspection is allowed only to (a) BIR officials and employees whose official duties require such inspection; (b) the person who made the return, or his duly constituted attorney-in-fact; (c) the administrator, executor, or trustee of. the taxpayer's estate or the duly constituted attorney-in-fact of such administrator, executor, or trustee, where the maker of the return has died; and (d) in the discretion of the Commissioner of Internal Revenue, one of the heirs of law or next of kin of such deceased person upon showing that he has a material interest which will be affected by the information contained in the return (cited in BIR Ruling No. DA-020-03 dated January 27, 2003). HIAEaC It appears that the Special Power of Attorney executed by Zenaida C. Bucu dated September 27, 1990 did not specifically authorize you secure a photocopy of her 1998 income tax return. In view of the foregoing, this Office regrets to deny your request for lack of legal basis. Very truly yours, (SGD.) JOSE MARIO C. BUAG Deputy Commissioner Legal & Inspection Group